Marcos Antonio Mendoza

Abstract

Scholars have eloquently detailed the “Insurance as Governance” concept, the potential capacity for reinsurer regulatory influence on insurers, and the many aspects under which these theories may arise. This Article takes the next step in analyzing the complex reinsurer–insurer relationship through empirical research into how carriers are actually influenced by reinsurers, and what effect this has on the parties. As a case study in the governance role played by reinsurance institutions, this Article organizes survey interview responses of senior officials in the governmental entity self-insured risk management pool sector into four distinct discussion areas: (i) how reinsurers influence pools in general and in the key areas of underwriting, claims, and finance/solvency; (ii) the duty of utmost good faith and its effect; (iii) the level to which pools afford accommodation to reinsurers; and (iv) whether reinsurer influence varies based on pool circumstances or external factors. While analysis of the data collected showed varying degrees of regulation or governance by reinsurers, the Article concludes that not only does a form of reinsurance influence or “governance” clearly exist in the largely unregulated world of self-insured pools—whether characterized as direct, indirect, or regulatory in nature—but also that the governance effect is an open and recognized influence that is accepted by the pools.

Ronen Avraham, Kyle D. Logue & Daniel Schwarcz

Abstract

Discrimination in insurance is principally regulated at the state level. Surprisingly, there is a great deal of variation across coverage lines and policyholder characteristics in how and the extent to which risk classification by insurers is limited. Some statutes expressly permit insurers to consider certain characteristics, while other characteristics are forbidden or limited in various ways. What explains this variation across coverage lines and policyholder characteristics? Drawing on a unique, hand-collected dataset consisting of the laws regulating insurer risk classification in fifty-one U.S. jurisdictions, this Article argues that much of the variation in state-level regulation of risk classification can be explained by focusing on three factors: (i) the predictive capacity of the characteristic in question; (ii) the extent of the adverse selection problem created if the characteristic is restricted; and (iii) the extent to which discrimination on the basis of the characteristic is considered illicit. The Article concludes by suggesting that this implicit conceptual framework, which is embedded in the pattern of general and specific insurance anti-discrimination laws enacted by states across the country, sheds new light on the nearly universal state prohibition against “unfair discrimination” by insurers.

Michael D. Randall

Abstract

This Note analyzes the NCAA’s effective prohibition on student-athletes exploring outside insurance to cover the loss of value of their athletic talents. Currently, the vast majority of collegiate athletes are only permitted to obtain insurance for career-ending injuries. Existing NCAA Bylaws serve to effectively prevent these individuals from protecting themselves against value- or earnings-potential–reducing injuries. This situation is of particular concern because of the importance and prevalence of intercollegiate athletics as a (sometimes mandatory) step toward a career in professional sports. This Note examines the NCAA’s current insurance structure and the rationales for this system, which includes an effective prohibition against obtaining loss of value insurance to guard against losses in earnings. It then explores why this bar should be lifted and how current student-athletes could mount a challenge, as well as possible remedies and the implications of a successful challenge. Finally, it discusses how the NCAA and its member institutions could implement a loss-of-value insurance program, should they choose or be required to do so, and what concerns would arise.

Ashley A. Noel

Abstract

For the last several decades, the United States has been facing an uphill battle against obesity. In addition to constituting a public health crisis, the increasing prevalence of obesity poses serious economic consequences for the United States as health care costs continue to soar. In an attempt to combat this growing problem, Congress included numerous provisions in the Patient Protection and Affordable Care Act aimed at reducing the high rates of obesity in the United States. This Note argues that the Affordable Care Act could have more effectively addressed the obesity crisis by providing a meaningful financial incentive encouraging the adoption of healthier lifestyles to obese Americans. This Note suggests two ways in which the Affordable Care Act could have incorporated such an incentive: (1) an amendment to section 213 of the Internal Revenue Code and (2) mandatory insurance coverage of weight loss– and health–related expenses.

John L. Watkins

Abstract

Application of the Erie doctrine requires that federal courts exercising diversity jurisdiction apply substantive state law consistent with the state’s highest court as a matter of federalism and to discourage forum shopping. This Article analyzes the reality, however, that federal courts decide important unsettled questions of state law differently than state courts, which undermines these two fundamental underpinnings of the Erie doctrine. Further, this Article demonstrates, through various examples, how these incorrect “Erie guesses” can have profound practical implications in the insurance context due to the standard use of form contracts for drafting insurance policies. As a result, litigants battle fiercely over the judicial forum, as federal courts are perceived, particularly by insurers, to decide procedural and substantive issues of state law differently than state courts. Considering that the abolishment of diversity jurisdiction is highly improbable, this Article argues that federal courts should adopt clear, uniform standards that favor the liberal use of certification of unsettled questions of state law to the state’s highest court. A constitutionally consistent approach to certification would promote the principles of federalism that underlie the Erie doctrine and would render moot the less productive question of why federal courts decide the issues differently.

Christine H. Monahan

Abstract

This Article documents how, contrary to popular narratives, the states were given and took advantage of numerous opportunities to weigh in on health insurance exchange implementation under the Affordable Care Act. This engagement was driven by frequent informal consultation with federal officials, although states were also regular participants in regular notice-and-comment rulemaking. This Article identifies four factors that appear to have affected how much influence states were able to exercise over federal decision-making, and concludes by discussing how changing dynamics may encourage states to push for a more formal seat at the table in future exchange policy deliberations.

Gregory J. Chase

Abstract

Insurance and adoption seem like two ideas that can co-exist and mingle with one another. Yet, how have only a few people even ever heard of the term adoption insurance? Adoption is a market that seems fairly constant as there will always be a sizeable number of Americans interested in going through the process. There also seems to be little risk, especially since adoption disruption for domestic adoptions in the United States occurs at very low rates. So where did the miscommunication occur when adoption insurance finally was created? Who is to blame for the failure of the pioneered adoption disruption insurance? Is it possible to see adoption disruption insurance, like the one created by Philadelphia Insurance Company, in the United States any time soon? Well, most people might think adoption and insurance are two words that do not fit together. Not surprisingly, the two have only recently overlapped. The Omnibus Budget Reconciliation Act of 1993 (OBRA-93) and the Health Insurance Portability and Accountability Act of 1996 (HIPAA), for example, were created with provisions that allowed adopted children to be insured under the adopting parents’ health insurance. These laws mandated health insurance companies that already provided employer-sponsored plans covering dependent children to include adopted children in those policies as if they were no different than biological children. But these laws seem to be the extent of how much the two words will ever overlap. One might think that the low rates of adoption disruption in America combined with the sometimes unbearable costs to adopt would bring about an avenue for insurance companies to mold a viable adoption disruption policy. But these two factors only describe a small portion of the considerations involved in pursuing adoption. One major factor is privacy. Insurance companies, like Philadelphia Insurance, might contend that overlooking the privacy factor proved fatal to their attempt to create an adoption disruption policy. Privacy remains crucial partly because a few high-profile adoption terminations brought about significant public disapproval for the families who terminated their adoptions. Thus, potential adopting parents are less willing to tell insurance companies—or anyone—that their adoption fell through because of them. Currently, former adoption disruption policies are mostly unknown to the public, as many individuals, adopting parents and non-adopting persons alike, do not know such policies ever existed. It seems that, based on insurance companies’ last attempt to generate interest in the policy, adoption disruption insurance will continue to be viewed as a myth for years to come.

John G. Day

Jessica L. Roberts

Abstract

If asked what was the central issue in Burwell v. Hobby Lobby, most informed Americans would likely reply that it was the conflict of reproductive health and religious freedom. This Essay, however, argues for an alternate reading of that now infamous case. It proposes that Hobby Lobby is best understood as a demonstration of how the continued reliance on employer-provided benefits renders employers de facto health-care policy makers with the ability to profoundly impact the health-care access of millions of Americans.

Srishti Miglani